When Honda first launched its current Insight hybrid, it was the cheapest hybrid on the Japanese market, and it quickly became the best-selling car in the country. Then everyone realized that the Prius was infinitely better for not much more cash, and the Insight dropped off. Now, Honda is trying to recapture its budget-hybrid mojo by releasing the car it probably should have made instead of the Insight: the Fit Hybrid. And they’ve priced the 1.3 liter IMA hybrid Fit at just $19,310 (1.59 million Yen), according to Automotive News [sub]. But this time, Honda’s not trying to take on the Prius directly. Says Honda CEO Takanobu Ito

They are totally different cars. Their price ranges are different and they look different. So I don’t consider the Prius as the Fit’s direct competitor. We just want many more people to own the Fit by expanding our line-up.

No word yet on possible US-market availability.

What does the line “It’s More Car Than Electric!” mean? Beats us, but apparently it’s supposed to make you want to buy a Chevrolet Volt. Maybe “The electric car you can just put gas in on those days when you’re not giving a crap about the environment” was too long. Perhaps “It’s actually a series hybrid” didn’t pop with consumers. And maybe “Avoid the scary Range Anxiety® you get with ‘real’ electric cars” was too aggressive. All we know is, GM has registered “It’s More Car Than Electric,” and it’s time to get used to it. Meanwhile, how did we not find the ad parody above sooner?

In its retooling announcement for the Orion assembly plant, GM notes that

Orion will be the home to Chevrolet’s new small car and Buick’s future compact sedan – the all-new Verano.

What’s interesting is that GM doesn’t call the “new small car” the Aveo, even though it’s shown near-production versions of the new model bearing the Aveo name at several auto shows. Sooner or later, GM will have to start sticking with consistent, memorable nameplates in order to build up the kind of loyalty enjoyed by models like Accord, Camry, Civic and Corolla. Which would suggest that an improved Aveo should be called the Aveo, and that the new Opel Astra-based Buick Verano should be called something less instantly forgettable. We’ve speculated about what a three-door Buick Astra hatch might be called, but this Verano plan calls for an intervention. Help GM keep Buick from sliding into 90s-era ambivalence by improving on the narcoplesy-inducing nameplate Verano. It doesn’t have to be a heritage nameplate, but it should be something that makes the brands foray into compact cars seem like less of an afterthought. And that will be just as good four generations from now.

First of all, the Nissan Juke really is a fun car to drive. The engine’s an absolute cracker, and the chassis is shockingly composed. Too bad it’s impossible to mention the car without a full-blown war breaking out over its controversial styling. As I noted in my review, Nissan is unabashed about targeting a specific demographic with the Juke, and a number of practical concerns were overlooked in order to please what Nissan calls the “urban experience seeker.” In this video, Nissan’s Alfonso Albaisa shows that the Juke’s design is also a product of this intense focus on 30 year-old guys. Plus, counter-intuitively, a desire to forge a more cohesive design language across Nissans product portfolio. Had Albaisa and his team designed the Juke with more universal values in mind (but with the same widened Versa chassis and 1.6 liter direct-injected turbocharged engine), it’s tempting to believe they could have made a truly iconic automobile. And this is coming from someone who more or less fits the Jukes target demographic.

The six top-selling brands in America have sold between 450,000 and 1.3 million vehicles so far this year, with Hyundai (410,047) just missing the party. 2010 is shaping up to be Ford’s year, as the Blue Oval started strong and hasn’t looked back. Chevrolet has taken advantage of Toyota’s image issues to widen a lead for second place, putting Detroit on track for a one-two finish as the year enters its final quarter. But will Toyota fight back? Will Hyundai edge out the Pentastar’s last big-volume brand by the end of the year? Will Nissan follow Honda upwards or slide towards the oncoming Hyundai juggernaut? Stay tuned as Chart Of The Day documents the battle to the finish.

Once upon a time, there was a Volkswagen executive who couldn’t figure out how to get American consumers emotionally invested in his brand. Then one day it hit him: why not re-skin the Golf as a Beetle? It could be less practical and efficient than its donor car, but baby boomers would buy it in Costco volumes anyway, for the sheer gauzy nostalgia of it.  After flogging that Beetle for 12 years, through two successive updates to the car it was based on, it was time to update the old classic. But how?

Luckily history had an answer. Following the example of Beetle tuner/modders at the end of the original Beetle’s lifespan, VW apparently chopped the roof, exaggerated the fenders and called it good. Perhaps with the goal of making for a more “original” feel, the windscreen appears to have been moved back as well. Unfortunately tough, the change simply emphasizes the front-engine proportions, making the end result more reminiscent of a Morris Minor than the ur-Käfer. But, as the Volkswagen executive had learned by now, Americans don’t notice that stuff. The only remaining problem: how to avoid calling it “The new New Beetle.”

Given the rush to load up cars with the latest technological gadgets, you’d think that in-car television would have taken off by now. But Chrysler, the pioneer of in-car live TV, has sold only 850 units of its FLO TV system since it began offering the $629 (plus installation) MOPAR accessory last year, according to the Detroit News. And now Qualcomm is winding down its FLO TV business (likely due to low sales, reports the LAT), leaving Chrysler with only the Sirius TV subscription service to offer consumers who want live TV in their Grand Caravan. Chrysler is

Bloomberg reports that the credit rating firm Fitch Ratings has given GM a BB- credit default rating, the same as Ford Motor Credit. The difference: Ford has over $20b in debt, while GM is sitting on less debt and more cash. So why the identical rating? Fitch’s Stephen Brown explains:

Although they have similar ratings, you sort of get to them from different paths. GM doesn’t have a whole lot of debt, but they have very large pension obligations. Ford’s pension obligations are significant, but they’re lower than GM’s by quite a bit. But Ford has a lot of debt.

At the end of the first half of 2010, GM had $32b in cash and $8b in debt, while Ford had $22b in cash and $27b in debt. GM’s pensions, on the other had, are underfunded to the tune of $27b, while Ford’s are underfunded by $6.1b. Analysts have consistently suggested that GM’s IPO valuation should be in the neighborhood of Ford’s $40b market cap, and an identical credit rating seems to confirm the wisdom (or at least the popularity) of the comparison. Unfortunately, a $40b GM valuation would fail TTAC’s last standard for even marginal bailout “success.” After all, if GM is worth less than the $50b taxpayers put into it, there’s going to be no chance of spinning the IPO as a success.

The Countryman is a game-changer for us. We are going from extra-small to small

Former GM CEO Fritz Henderson is no longer a $3000/hr consultant for General Motors, reports Reuters [via ABC]. Henderson, who was paid $59,090 per month for 20 hours of work per month as a consultant, left that lucrative position after being hired by Sunoco to oversee the spin-off of its SunCoke Energy business. TTAC estimates that Henderson made over $400,000 since being fired as CEO by Chairman Ed Whitacre. We remain mystified as to what possible impact his consultancy had on anything, short of possibly preventing an embarrassing (but likely very dull) tell-all book.

The flip-flopping over GM’s IPO strategy continues, as The General backs away from its “retail investor” focus and begins courting Sovereign Wealth Funds in earnest. Bloomberg reports that GM’s underwriters have approached

Riyadh, Saudi Arabia- based Kingdom Holding Co., Abu Dhabi-based Mubadala Development Co., Qatar Holdings LLC and Singapore-based Temasek Holdings Pte.

In hopes that they’ll become “cornerstone investors” in the new GM’s IPO. Who knows what will come of the negotiations, but assuming that one or more of the Arab SWFs end up with a large chunk of GM equity, a number of PR problems present themselves. Though (marginally) less emotionally-charged than a possible ownership stake by a Chinese firm, such an outcome would amount to the US-sponsored foreign takeover of an American firm. Politically, the bailout is much easier to justify if GM ends up in American hands… especially since Fiat is likely to gobble up the Chrysler equity it wasn’t handed on a taxpayer-funded platter. But beyond that, GM will have to work twice as hard to convince the American people that it’s not working to serve the interests of its oil-rich Gulf State owners. Renewed scrutiny over its most profitable business, namely gas-guzzling trucks and SUVs, would be a given. Any hesitation (however well-justified) over electrification of the automobile would be interpreted as an oil-cartel plot. And renewed turmoil in the middle east could further inflame anti-Arab or anti-Muslim sympathies, potentially bringing greater pressure on GM. Meanwhile, GM’s energy-independence rhetoric around its E85 ethanol efforts would be extremely awkward.

But will Americans notice or care? At what percentage of ownership would these factors come into play?

The recommendations are simple: Scrap the vertical label, lose the letter grade and emphasize the mpg and cost of owning the vehicle. If the EPA takes these steps, it may be successful in increasing the number of fuel-efficient vehicles on the road and communicating clearly with consumers.

Alan Siegel of brand consultants Siegel+Gale summarizes his firm’s independent research on proposed EPA fuel economy label designs in Automotive News [sub]. Siegel interviewed 456 prospective new car buyers, and found that 66 percent preferred the “horizontal” proposal, while 47 percent found the “vertical” style (which includes the letter grade) “confusing.” No word on what percentage found the letter grades to be “asinine.”

(Read More…)

OK, so what’s literally wrong with the picture is that TTAC needs a real graphics team. The larger, figurative problem: Ford is replacing its long-soldiering Lincoln Town Car, the granite-standard of livery transportation, with its unloved (5,701 sales year-to-date) MKT crossover. Say what you want about the old Town Car, at least it had a certain quietly anonymous gravitas. The MKT? Let’s just say that a stretched version will serve largely to make the adjective “cetacean” even more applicable to the baleen-snouted crossover. According to the Freep, Ford will offer

With sales of its aging city car circling the toilet, Roger Penske’s Smart USA has reached a deal with Nissan to sell a Smart-branded version of a Nissan-developed four-door B-segment car, likely the Versa. Though Penske’s organization apparently pushed for and announced the deal, and the model will be exclusive to the US, the Detroit News calls the move “part of the growing cooperation between the Renault-Nissan Alliance and Daimler AG.” Penske says

While some have questioned why TARP was used to support the automotive industry, both the Bush  and Obama Administrations determined that Treasury’s investments in the auto companies were
consistent with the purpose and specific requirements of EESA.  Among other things, Treasury
determined that the auto companies were and are interrelated with entities extending credit to
consumers and dealers because of their financing subsidiaries and other operations, and that a
disruption in the industry or an uncontrolled liquidation would have had serious effects on financial
market stability, employment and the economy as a whole.

Translation: credit dependence killed the car companies. And from the 0% Red Toe Tag Sales to GM Daewoo’s $2b currency gambling loss, the glove fits. It’s a lesson that isn’t brought up often enough, and it’s one of the only passages of note in the Auto Industry Financing Program section of Treasury’s two-year TARP retrospective [PDF here]. Otherwise, the document is swallowed up in accounting for the billions spent on banks, despite the fact that

We now have recovered most of the investments we made in the banks.  Taxpayers will likely earn a profit on the investments the government made in banks and AIG, with TARP losses limited to
investments in the automobile industry and housing programs.

So, why not explain why projected auto rescue losses were reduced to $17b with more than just a footnote? [#2 on Figure 2-B shown above]